Exports won’t hurt Canada’s energy security, LNG sector says
The lobbying arm of B.C.’s liquefied natural gas industry has rejected suggestions that Canada doesn’t have enough natural gas to support large-scale exports.
The criticisms, in a geologist’s report released Tuesday by the Canadian Centre for Policy Alternatives, focused on how the production levels of proposed LNG plants would outpace the sector’s ability to supply them from current, known gas fields.
However, the critique doesn’t take into account the amount of gas that is becoming surplus because of dropping exports to the United States, David Keane, president of the B.C. LNG Alliance, said on Wednesday. Nor, he said, does it factor in the continued pace of new gas discoveries.
“I think that the author is cherry-picking some of the facts,” Keane said. “And I think when you look at the amount of gas resources available in British Columbia, there is a tremendous amount of resource available for production and export.”
The BC LNG Alliance represents seven of the major proposals for B.C. including Pacific NorthWest LNG, whose main backer is Malaysia’s state-owned Petronas, the Shell-backed LNG Canada proposal and Exxon Mobil.
No proponent has approved construction of one of the multi-billion-dollar LNG projects, but geoscientist David Hughes argued in the Policy Alternatives report that commitments given to the top contenders, by way of export licences from the National Energy Board, would require a massive increase in drilling and production.
Some 19 proponents are developing LNG proposals and the National Energy Board has awarded export licenses to 12 although the industry expects there would only be room for three to five plants.
Hughes’ analysis suggests there is enough gas from Western Canada to support only one major LNG export plant.
Hughes was critical of figures B.C. has published suggesting that the province has 2,933 trillion cubic feet of gas. That is far in excess of the 2013 estimates of 42 trillion cubic feet of proven reserves and 442 trillion cubic feet of estimated reserves, published by the B.C. Oil & Gas Commission.
“It would seem to me to contradict the B.C. Oil and Gas Commission and NEB estimates,” Hughes said.
However, Keane said 2,933 trillion cubic feet is a figure that the commission and energy board geologists “do believe we have.”
“Probably not all of that is economically recoverable, but when you look at the amount of natural gas reserves in British Columbia, they continue to grow year after year,” Keane said.
He said companies would not be proposing $8-billion liquefaction plants and $5-billion pipelines if they did not believe there was gas to feed them.
“They wouldn’t be developing them if they didn’t firmly believe that the natural gas supplies are available,” Keane said.